HR Practice For Payroll Practitioners

HR Practice for Payroll Practitioners

Performance management

Performance management or the results from that system can help management see the importance of the position in the organisation. This can only be achieved if the performance management system links the organisation’s objectives to the individual’s perfor mance (breaking them down from high-level objectives to the tasks that an individual has to do).

For instance:

The high-performing salesperson sets sales targets that show the dollar value per sale to the organisation. The salesperson’s worth can easily be seen by management in the amount of goods or services sold. Types of base pay

There are a number of different methods of paying the base pay component of an employee’s remuneration:

Time-based pay Skill-based pay

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Service-related pay

Time-based pay

Employees are paid at regular intervals for the time they have actually worked. This is the most common base pay method.

Skill-based pay

Employees are paid for their skill and knowledge and how they apply that to the job and the work required. This is very much focussed on what the employee can do for the organisation.

Service-related pay

Employees receive a fixed increment based on service in the job. Increments are usually from a formalised pay scale or range.

Other factors in determining base pay rates

To finish this section on base pay, let’s look at two other factors that are used to determine its value.

Legislation

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© New Zealand Payroll Practitioners Association, Sep 2024, Ver 12

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